15 July 2024

The Trade Academy Team

07:30 CET - 3 min read

Monday Morning Coffee - Markets Update - July 15, 2024 - Greenback ​Firms, while Bond Rally Fizzles Following Trump Assassination Attempt

Markets Update: PredictIT Indicates Increased Republican Victory Likelihood. China's Economic Data Disappoints Expectations. Fed ​Chair Powell Scheduled to Speak Later Today, Markets Eye September Rate Cut.

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Global Markets Roundup: 15 July 2024

On Monday, U.S. bond futures declined while the dollar strengthened, as ​investors bet that recent political turmoil surrounding U.S. presidential ​candidate Donald Trump increased his chances of winning the election, ​thereby heightening political uncertainty. With Japanese markets closed for a ​holiday, trading volumes were thin. Early market movements saw a modest ​rise in the dollar, coupled with a dip in Treasury futures.

Historically, the prospect of a Trump presidency has driven Treasury yields ​higher due to expectations that his economic policies would lead to increased ​inflation and debt. Proposed tariffs on imports are seen as inflationary while ​potentially reducing consumer spending, and migration restrictions could ​tighten the labor market, exerting upward pressure on wages. PredictIT, an ​online betting platform, shows the likelihood of a Republican victory rising to ​66 cents from 60 cents on Friday, while the odds for a Democratic win stand ​at 38 cents. This suggests Republicans are currently twice as likely to win the ​election compared to Democrats.

Futures for 10-year Treasuries fell by 13 ticks (TYc1), while cash bonds ​remained untraded due to the Japanese holiday. S&P 500 futures ES1! and ​Nasdaq futures NQ1! both saw slight gains. Despite the closure of Japan's ​Nikkei index NI225, futures (NKc1) traded at 41,285 compared to a previous ​cash close of 41,190. Mainland stocks (000001) along with Hong Kong's ​Hang Seng index HSI were down, with the latter dropping by 1%.

Kicking off a busy week, China released disappointing economic data just ​ahead of a major five-year gathering of top officials from July 15-18. The ​world's second-largest economy grew by 4.7% in the second quarter ​compared to the previous year, below the forecasted 5.1%. Additionally, ​June retail sales growth was an annualized 2%, missing expectations of 3.3%, ​which increases pressure on Beijing to introduce supportive measures. New ​home prices experienced their steepest decline in nine years.

The dollar appreciated by 0.3% against the Japanese yen to 158.05 USDJPY, ​though it remained below its recent high of 161.96, which was influenced by ​suspected market intervention. The euro dipped slightly to $1.0887 ​EURUSD, and the dollar index firmed marginally to 104.26 DXY. The yuan ​USDCNY faced pressure at 7.2608 per dollar. The Australian dollar AUDUSD ​fell 0.08% to $0.6778, while the New Zealand dollar NZDUSD lost 0.29% to ​$0.6100.

In the commodities/agricultural commodities market, GOLD remained steady ​at $2,408 an ounce, slightly below last week's peak of $2,424. Oil prices saw ​minor increases, recovering from a drop on Friday amid signs of progress in ​ceasefire talks between Israel and Hamas. Brent crude BRN1! rose 8 cents to ​$85.11 a barrel, while U.S. crude CL1! also gained 8 cents, reaching $82.29 ​per barrel. Three-month copper on the LME HG1! traded 0.2% higher at ​$9,892.50 per metric ton. Corn ZC1! shed 0.8% to $4.11-1/2 a bushel. ​CBOT wheat ZW1! edged 1.3% lower to $5.43-3/4 a bushel.

Among the major companies reporting earnings this week are Goldman ​Sachs, BlackRock, Bank of America, Morgan Stanley, Netflix, and Taiwan ​Semiconductor Manufacturing.

Looking ahead today, Federal Reserve Chair Jerome Powell is scheduled to ​speak later today, and markets anticipate his comments on last week's ​subdued inflation data. Later this week, the U.S. will release key economic ​data including retail sales, industrial production, housing starts, and weekly ​jobless claims. The European Central Bank is set to meet on Thursday, with ​rates expected to hold steady at 3.75%, ahead of a likely rate cut in ​September.

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General news - Information source from multiple newswires.

The article and the data is for general information use only, not advice!

The Trade Academy Team